Wachtell, Lipton, Rosen & Katz’s fee arrangements with clients have long been cloaked in mystery. Over the years, we’ve heard that Wachtell doesn’t charge hourly rates for M&A deals, but details of its billing structure weren’t widely known.
Now we have an idea. The American Lawyer has obtained what appears to be a standard fee agreement that Wachtell sent a client in 2012. It shows that the firm typically charges fees for M&A deals that range from 1 percent to 0.1 percent of the transaction amount. The fee agreement was signed by CVR Energy Co., an oil refining and fertilizer business that paid Wachtell $6 million for a three-month failed takeover defense against corporate raider Carl Icahn. CVR is now suing Wachtell and two of its partners for malpractice in Manhattan federal court and seeking return of the $6 million. Wachtell says that CVR’s claims are meritless. The firm has filed a countersuit in New York state court, seeking a declaratory judgment that it did not commit malpractice.
